Soft closure - Pictet CH Precious Metals Physical Gold fund

Pictet Asset Management has informed us that in light of current lock-down conditions in Europe (resulting from the COVID-19 pandemic), which very significantly reduces the immediate ability of gold foundries to deliver physical gold bullions to the custodian bank, it has had to soft close its Pictet CH Precious Metals Fund - Physical Gold fund, the result of which will put limits on its daily subscription fulfilment. 

Pictet will monitor subscription requests. Amounts that are above the trading capacity of the fund will not be possible to process. It will continue to actively monitor the situation and adapt daily capacity based on the availability of physical gold communicated by the custodian bank. Pictet believe these measures are in the best interest of investors as it aims to protect their interests and ensure that 100% of their investment is backed by physical gold.

The immediate impact the soft closure has on our defined fund ranges

As Pictet cannot guarantee that all daily subscriptions received can be processed, this does unfortunately provide RL360 with a challenge in regard to our products that have a defined fund range (those listed above) as we must be able to guarantee that any trades we place can be honoured on the same day. As this cannot currently be offered by Pictet, we will not be able to accept any regular payments into the Pictet fund through these products while it remains soft closed. This will be with effect from 31 March 2020 and until Pictet advise us that the fund is no longer soft closed and able to accept subscriptions without any capacity constraints. 

To ensure payments received continue to be fully invested, we have had to take immediate action for all regular payment plans and apologise that advance notice could not be provided due to the circumstances. The regular payment allocation has been redirected from the Pictet fund into an alternative fund in the fund range - the UBS (Lux) Money Market fund ("the alternative fund") - which is a currency/money market fund. We will monitor the situation and once Pictet inform us that the soft closure has been lifted we will arrange to redirect the payment allocation from the alternative UBS fund back into the Pictet fund. 

Please note that the soft closure does not affect any existing unit holding in the Pictet fund, and plans can continue to hold these units, which are being priced as normal on a daily basis. This also does not affect any redemptions should investors wish to redeem units or switch holdings into another fund available to their plan.

During the soft closure, we will also not be able to accept any switches, or top ups, into the soft closed fund until further notice. 

We are writing to plan owners, or their appointed investment adviser, informing them of the action we have taken and their option for redirecting payments to a different fund if they prefer. Servicing financial advisers will receive a copy for information. Samples letters can be viewed above. 
 

The impact on open-architecture portfolio bonds

Portfolio bond owners, or their investment advisers, can continue to place subscriptions into the fund as normal. The trade will be subject to acceptance by Pictet and RL360 cannot offer any guarantee that this will be on the day of subscription or a number of days after as this will be subject to Pictet's daily capacity limits.